LBTT and other costs

Beyond the excitement of finding your dream property, it's crucial to be well-informed about the additional costs that come with buying your first home.

In this section, we will guide you through key considerations such as the Land and Buildings Transaction Tax (LBTT), the need for an extra budget to bid over the home report value (as banks often cap their lending at this value), legal fees, and the often underestimated expense of homeware for your new home.

What is Land and Buildings Transaction Tax (LBTT)

Land and Buildings Transaction Tax (LBTT) is a tax that must be paid when you buy property in Scotland. It applies to residential property purchases above a certain threshold and is calculated based on the purchase price of the home.

First-time buyers may be eligible for relief on some or all of the LBTT, depending on the value of the property. Your solicitor will handle the registration and payment of LBTT as part of the legal process. This involves submitting a return to Revenue Scotland and ensuring the correct amount is paid before the property title is transferred to your name. While you don’t need to calculate or file it yourself, it’s important to understand how LBTT fits into your overall costs and budgeting when buying your first home.

Understanding these additional costs ensures you approach the home buying process with eyes wide open, empowering you to make sound financial decisions and turning your dream of buying your first home into a well-planned reality.

To find out how much property tax you will pay on a property purchase, visit our LBTT Calculator.